Hedge funds poured into financials in the fourth quarter, giving a vote of confidence to an array of battered banks.

And no bank has the confidence of the hedge fund community like Citigroup. The troubled financial services giant saw at least 100 hedge funds buying shares in the last three months of 2009, led by Paulson & Co.

The New York-based hedge fund boosted its stake in Citi by almost two-thirds, buying 200 million shares during the period to increase its investment in the bank to $1.67 billion. That accounts for some 8% of Paulson’s $20 billion in assets under management.

But Paulson wasn’t alone in hoarding Citi shares in the fourth quarter. Eton Park Capital Management gobbled up 138 million shares, making the bank its largest holding at almost $470 million. Soros Fund Management bought some 94.7 million shares, now worth almost $322 million.

Appaloosa Management increased its stake by about 50 million shares to 138 million. Edward Lampert’s RBS Partners added 12.5 million shares to boost its stake to 31.3 million. Brevan Howard Asset Management quadrupled its stake to roughly 3 million shares.

But Citi was not the only beneficiary of the hedge fund taste for banks. Brevan Howard and RBS bought in to Bank of America in the fourth quarter, with Lampert’s fund buying more than 450,000 shares and Brevan increasing its stake to almost 2 million shares worth almost $30 million.

Other hedgies were less bullish on BofA. Both Paulson and Appaloosa trimmed their investment in the bank, the former by 5.5% to 151 million shares and the latter by 4.7% to 32 million shares.

Wells Fargo also earned some attention from hedge funds, with Appaloosa buying 11 million shares and Lampert 1.5 million. Troubled lender CIT, which recently named former Merrill Lynch and New York Stock Exchange CEO John Thain is new CEO, attracted some interest, with Lampert buying 4.5 million shares and Paulson 4.4 million.

Despite its taste for Citi and BofA, Brevan Howard also dumped a pair of relatively small financial bets in the fourth quarter. The London-based hedge fund, the largest hedge fund manager in Europe, sold its $34 million stake in Brazil’s Banco Bradesco, and a $1.15 million investment in Goldman Sachs.